SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
/X/ QUARTERLY REPORT pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1997 or
_____________
/ / TRANSITION REPORT pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the transition from to
Commission File Number 1-9788
______
LANDAUER, INC.
--------------------------
(Exact name of registrant as specified in its charter)
Delaware 06-1218089
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2 Science Road, Glenwood, Illinois 60425
------------------------------------------
(Address of principal executive offices and Zip Code)
Registrant's telephone number, including area code (708) 755-7000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No .
___ ____
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at August 8, 1997
--------------------------- ------------------------------
Common stock, $.10 par value 8,482,285
PART I. FINANCIAL INFORMATION
LANDAUER, INC.
Balance Sheets
(000's)
ASSETS
______
<TABLE>
<CAPTION>
June 30, Sept. 30,
1997 1996
----------- ----------
derived from
(unaudited)(audited statements)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 3,433 $ 3,359
Short-term investments 5,937 7,885
Accounts receivable,
less allowances of
$188,000 at 6/30/97
and $161,000 at 9/30/96 8,610 7,545
Inventories 1,173 879
Prepaid expenses 70 152
Deferred taxes on income 1,499 1,499
------- -------
Total current assets 20,722 21,319
Property, plant and equipment, 19,204 18,065
at cost Less: Accumulated
depreciation and amortization 11,528 10,340
-------- --------
Net property, plant and equipment 7,676 7,725
Investment in U.S. Treasury Securities 4,966 2,936
Cost of purchased businesses in excess
of net assets acquired 2,654 2,779
Equity in Japanese joint venture 4,182 4,069
Other assets 2,971 2,775
--------- ---------
$ 43,171 $ 41,603
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Balance Sheets (Cont'd.)
(000's)
LIABILITIES AND STOCKHOLDERS' INVESTMENT
________________________________________
<TABLE>
<CAPTION>
June 30, Sept. 30,
1997 1996
--------- ---------
derived from
(unaudited)(audited statements)
<S> <C> <C>
Current liabilities:
Accounts payable $ 347 $ 422
Deferred contract revenue 8,385 8,375
Dividend payable 2,545 2,331
Accrued compensation and related costs
1,474 1,235
Accrued pension costs 1,067 1,265
Accrued expenses 2,592 1,781
Accrued taxes on income 634 1,335
------- --------
Total current liabilities 17,044 16,744
------- --------
Stockholders' investment:
Preferred stock, $.10 par value per share -
Authorized - 1,000,000 shares
Outstanding - None -- --
Common stock, $.10 par value per share -
Authorized - 20,000,000 shares
Outstanding - 8,482,285 shares at 6/30/97 and
8,477,285 shares at 9/30/96 848 848
Premium paid in on common stock 7,818 7,642
Cumulative translation adjustments 153 238
Retained earnings 17,308 16,131
-------- --------
Total stockholders' investment 26,127 24,859
-------- --------
$ 43,171 $ 41,603
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Statements of Income
(000's, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
----------------------- ------------------
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
-------- ------ ------ -------
<S> <C> <C> <C> <C>
Net revenues $ 9,984 $ 9,010 $ 29,572 $ 27,188
Costs and expenses:
Cost of revenues 3,140 2,739 9,035 8,155
Selling, general and
administrative 2,781 2,450 7,918 7,389
------ ------ ------ ------
5,921 5,189 16,953 15,544
------ ------ ------ ------
Operating income 4,063 3,821 12,619 11,644
Other income, net 378 372 1,135 1,175
------ ------ ------ ------
Income before income taxes 4,441 4,193 13,754 12,819
Income tax provision 1,581 1,584 4,946 4,802
------ ------ ------- -------
Net income $ 2,860 $ 2,609 $ 8,808 $ 8,017
======== ======== ======== ========
Net income per share $ .34 $ .31 $ 1.04 $ .95
======== ======== ======== ========
Average shares outstanding 8,482 8,477 8,479 8,477
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Statements of Cash Flows
(000's)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
------------------------
June 30, June 30,
1997 1996
--------- ---------
<S> <C> <C>
Net cash flow from operating activities:
Net income $ 8,808 $ 8,017
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation and amortization 1,937 1,865
Equity in net income of foreign affiliate (561) (705)
Compensatory effect of stock options 176 59
Increase in accounts receivable (1,058) (1,150)
Increase in inventories (294) (45)
Decrease in prepaid expenses 82 200
Decrease in accounts payable (75) (318)
Increase in deferred contract revenue 10 671
Increase in accrued expenses 151 15
Net increase in other
non-current assets (820) (418)
------- -------
Net cash generated
from operating activities 8,356 8,191
Cash flow used by investing activities:
Purchases of U.S. Treasury Securities (1,038) (7,350)
Maturities of U.S. Treasury Securities 956 7,424
Acquisition of property, plant,
and equipment (1,139) (1,074)
------- --------
Net cash used by
investing activities (1,221) (1,000)
Cash flow from financing activities:
Dividend received from foreign affiliate 356 386
Dividends paid (7,417) (6,781)
-------- --------
Net cash used by financing activities (7,061) (6,395)
-------- --------
Net increase in cash 74 796
Opening balance - cash and cash equivalents 3,359 1,915
-------- --------
Ending balance - cash and cash equivalents $ 3,433 $ 2,711
======== ========
Supplemental Disclosure of Cash Flow
Information:
Cash paid for income taxes $ 5,647 $ 5,815
======== ========
Supplemental Disclosure of Non-cash
Financing Activity: Dividend declared $ 2,545 $ 2,331
Foreign currency translation adjustment $ (85) $ (536)
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Notes to Financial Statements - June 30, 1997
(Unaudited)
(1) Basis of Presentation
_____________________
The accompanying unaudited condensed financial statements
reflect the financial position of Landauer, Inc. ("Landauer") as
of June 30, 1997 and September 30, 1996, and the results of
operations and cash flows for the three-month and nine-month
periods ended June 30, 1997 and 1996. In the opinion of
management, the accompanying unaudited condensed financial
statements contain all adjustments necessary to present fairly
the financial position of Landauer as of June 30, 1997 and
September 30, 1996, and the results of operations for the three-
month and nine-month periods ended June 30, 1997 and 1996, and
cash flows for the nine-month periods ended June 30, 1997 and
1996.
The accounting policies followed by the Company are set
forth in Note 1 to the Company's financial statements in the 1996
Landauer Annual Report on Form 10-K, which is incorporated by
reference.
The results of operations for the three-month and nine-month
periods ended June 30, 1997 and 1996 are not necessarily
indicative of the results to be expected for the full year.
(2) Cash Dividends
______________
On June 5, 1997, the Company declared a regular quarterly
cash dividend in the amount of $.30 per share payable on July 3,
1997, to stockholders of record on June 19, 1997. On March 7,
1997, the Company declared a regular quarterly cash dividend in
the amount of $.30 per share payable on April 4, 1997, to
stockholders of record on March 21, 1997. On November 7, 1996,
the Company declared a regular quarterly cash dividend in the
amount of $.30 per share payable on January 9, 1997, to
stockholders of record on December 27, 1996.
Regular quarterly cash dividends of $.275 per share ($1.10
annually) were declared during fiscal 1996.
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Liquidity and Capital Resources
_______________________________
Landauer's cash flow from operating activities for the nine
months ended June 30, 1997 and 1996 amounted to $8,356,000 and
$8,191,000, respectively. Investing activities for the first
nine months of fiscal 1997 and 1996 resulted in market changes in
U.S. Treasury securities. Acquisitions of property, plant and
equipment amounted to $1,139,000 and $1,074,000, respectively.
The Company's financing activities were limited to payments of
cash dividends, offset by foreign dividends received from Nagase-
Landauer, Ltd., our Japanese joint venture.
LANDAUER, INC.
Management's Discussion and Analysis of Financial Condition
and Results of Operations (Cont'd.)
The Company has no long-term liabilities and its requirement
for cash flow to support investing activities is generally
limited. Capital expenditures for the balance of fiscal 1997 are
expected to amount to $1,000,000, principally for computer
hardware, the development of software systems, and acquisition of
equipment to support growth, technology enhancements and cost
reductions. The Company anticipates that funds for these capital
improvements will be provided from operations.
The Company presently maintains no external sources of
liquidity, and, in the opinion of management, resources are
adequate for projected operations and capital spending programs,
as well as continuation of the regular cash dividend program.
Landauer requires limited working capital for its operations
since many of its customers pay for services in advance. Such
advance payments amounted to $8,385,000 and $8,375,000,
respectively, as of June 30, 1997 and September 30, 1996, and are
included in deferred contract revenue. While these amounts
approximate one-half of current liabilities, such amounts do not
represent a cash requirement.
Results of Operations
_____________________
Revenues for the quarter ended June 30, 1997 were 11% higher
compared with the same quarter a year ago. The increase in
revenues was attributable to unit gains and higher pricing in the
Company's traditional radiation dosimetry business and higher
radon protection plan sales. Gross margins for the third fiscal
quarter were 68.5% of the revenues compared to 69.6% for the same
period in fiscal 1996. The decrease in margins was primarily
attributable to higher costs associated with increased radon
protection plan activity.
Selling, general and administrative expenses were higher in
the current quarter as a percent of revenues at 27.9% compared to
27.2% for the third quarter of fiscal 1996. As a result,
operating income for the third fiscal quarter of 1997 was 40.7%
of revenues compared to 42.4% for the same period last year.
Income before income taxes was 44.5% of revenues for the quarter
just ended compared to 46.5% for the third fiscal quarter of
1996.
The effective tax rate for the Company during the third
quarter of fiscal 1997 was lower at 35.6% compared with 37.8% for
the same period last year. Resulting net income of $2,860,000
for the third fiscal quarter of 1997 was 10% higher than
$2,609,000 reported in fiscal 1996. Income per share for the
quarter was $.34 versus $.31 for the third fiscal quarter of
1996.
LANDAUER, INC.
Management's Discussion and Analysis of Financial Condition
and Results of Operations (Cont'd.)
Revenues for the nine months ended June 30, 1997, were
almost 9% higher compared with the first nine months of fiscal
1996. The increase in revenues was attributable to unit gains
and higher pricing in the Company's traditional radiation
dosimetry business, as well as higher radon protection plan
sales. Gross margins for the first nine months of fiscal 1997
were lower at 69.4% of revenues compared with 70.0% a year ago.
The decrease in gross margins was principally attributable to
higher costs associated with the increased radon protection plan
activity.
Selling, general, and administrative expenses were lower for
the first nine months of fiscal 1997 as a percent of revenues at
26.8% compared to 27.2% for the first nine months of fiscal 1996.
The decrease reflected a modest growth rate in expenses relative
to the level of business activity. As a result, operating income
for the first nine months of fiscal 1997 was 42.7% of revenues
compared to 42.8% for the same period last year. Income before
income taxes was 46.5% of revenues for the nine months just
ended, compared with 47.1% for the same period in fiscal 1996.
The effective tax rate for the Company during the first nine
months of fiscal 1997 was 36.0% compared with 37.5% for the first
nine months of 1996. Resulting net income of $8,808,000 for the
first nine months of 1997 was 10% higher than $8,017,000 reported
in fiscal 1996. Income per share thus far in fiscal 1997 was
$1.04 versus $.95 for the same period in fiscal 1996.
PART II. OTHER INFORMATION
Item 2. Legal Proceedings
_________________
Landauer is involved in various legal proceedings but
believes that these matters will be resolved without a material
effect on its financial position.
Item 6. Exhibits and Reports on Form 8-K
________________________________
(a) No exhibits are filed with this report.
(b) There were no reports on Form 8-K during the quarter
for which this report is filed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
LANDAUER, INC.
Date: August 8, 1997
/s/ James M. O Connell
_______________________________
James M. O'Connell
Vice President and Treasurer
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000825410
<NAME> LANDAUER, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> JUN-30-1997
<CASH> 3,433
<SECURITIES> 5,937
<RECEIVABLES> 8,798
<ALLOWANCES> 188
<INVENTORY> 1,173
<CURRENT-ASSETS> 20,722
<PP&E> 19,204
<DEPRECIATION> 11,528
<TOTAL-ASSETS> 43,171
<CURRENT-LIABILITIES> 17,044
<BONDS> 0
<COMMON> 848
0
0
<OTHER-SE> 25,279
<TOTAL-LIABILITY-AND-EQUITY> 43,171
<SALES> 29,572
<TOTAL-REVENUES> 29,572
<CGS> 9,035
<TOTAL-COSTS> 9,035
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 13,754
<INCOME-TAX> 4,946
<INCOME-CONTINUING> 8,808
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,808
<EPS-PRIMARY> 1.04
<EPS-DILUTED> 1.04
</TABLE>
